Norway has boosted its production of natural gas at the expense of crude oil, in an effort to secure alternative supplies to compensate European countries for Russian gas, which meets nearly half of the old continent’s needs.
Europe is the largest consumer of Russian gas, which flows to its countries through a network of pipelines built in the 1960s. However, the Russian war on Ukraine sour relations that lasted for decades, amid fears that Moscow will cut off supplies to the continent due to its rejection of a military attack. According to what was monitored by the specialized energy platform.
Norway’s production of natural gas rose to 323 million cubic meters per day on an annual basis, an increase of 15.1 percent from last year’s production, with the aim of helping European countries increase the quantities of gas stored before the upcoming winter season, according to the website SP Global.
The winter months usually witness peak demand for gas in Europe, as it is used to generate electricity for heating homes, so the countries of the continent are making strong efforts to secure alternative supplies of gas and other sources of energy.
Crude Oil Production Declines
At the same time, Norway’s production of crude oil decreased by 2.5% on an annual basis in last May, and a decrease of 2.6% compared to April 2022.
Total crude oil production in Norway decreased during the month of May 2022, to 1.62 million barrels per day, compared to 1.66 million barrels per day in the same month of 2021, according to data from the Norwegian Petroleum Administration.
The country’s total liquids production, including natural gas liquids, declined by 0.8% over the year.
At the same time, Norway’s production of crude oil decreased by 2.5% on an annual basis in last May, and a decrease of 2.6% compared to April 2022.
Total crude oil production in Norway decreased during the month of May 2022, to 1.62 million barrels per day, compared to 1.66 million barrels per day in the same month of 2021, according to data from the Norwegian Petroleum Administration.
The country’s total liquids production, including natural gas liquids, declined by 0.8% over the year.
A sharp decline in oil production is expected in Norway during the month of June, as the refineries are undergoing seasonal maintenance operations, at a time when the country is likely to increase its production of natural gas as part of its plans to achieve energy security.
Among the oil fields that will be subject to the temporary closure decision, the giant “Johan Sverdrup” field, which represents nearly a third of the country’s production.
According to the plans, field maintenance operations will continue from June 20 to the first half of July.
The maintenance work comes within the framework of preparations to start production operations from the second phase of the field development project in the fourth quarter of this year, with the aim of increasing the field’s production capacity from 535,000 barrels per day to 755,000 barrels per day.
Norway’s Natural Gas Production
In turn, Ikovsk region fields saw a drop in oil loadings in June, most likely due to maintenance.
On gas, Equinor, owned by the largest oil and gas producer in Western Europe, said that it will maintain high natural gas production in the Troll, Oseberg and Hydron fields during the summer, in implementation of the decision issued by the Ministry of Oil and Energy, which provides an additional 1.4 billion cubic meters of gas. exports.
Norway’s total revenues from oil exports during 2021 amounted to approximately 349.6 billion Norwegian kroner ($40 billion), and natural gas exports increased four times compared to 2020 exports.
As part of efforts to increase exports, the company said maintenance work on the Oseberg field has been postponed to next September.
Last week, Norway’s Equinor and Britain’s Centrica announced, on Thursday 16 June, the signing of an agreement to deliver additional supplies of natural gas to the United Kingdom.
Oil and gas companies in Norway expect their investments during the current year 2022 to reach $17.57 billion, up from last February’s forecast of 159.5 billion crowns, according to the specialized energy platform.
The Role Of Norwegian Gas In Britain’s Energy Security
The new supply agreement adds approximately 1 billion cubic meters per year to Equinor’s existing bilateral contract with Centrica, and brings the total gas supply to more than 10 billion cubic meters per year.
With Britain now importing about a third of its gas from Oslo, this agreement underscores Norway’s strategic importance in supporting the UK’s energy security.
“At a time full of geopolitical and economic challenges, with strong gas demand, we at Equinor are doing everything we can to export as much gas to the market as possible,” said Helg Hogan, Vice President of Gas and Energy at Equinor.
He added: “Equinor is proud to be a reliable energy partner, with long-standing relationships with Centrica and the UK, and I am very pleased that with this agreement we can help secure additional energy supplies for Britain to meet its needs during the coming winters.”
Source: XglobalMarkets
